Sugarbeet News

A look back at the history of the Ontario Sugar Company

Samuel J. Williams, president of the Berlin Board of Trade, has just telegraphed home.

"We got the beet!" was the essence of his wire and that was the cliffhanger at the end of Flash from the Past last week.

The Ontario Sugar Company has decided to build its new half-million-dollar sugar beet factory in Berlin. Local industrialists, investors, workers and farmers hope to reap some of that investment. Facing stiff competition from other Ontario locales including Guelph, Baden and Galt, Williams had convinced the OSC dragons' denizens to invest in Berlin.

The hard work was just beginning for Williams (now also an OSC director): the syndicate wanted to be refining sugar by fall 1902 — nine months away. Without the necessity of public consultations, environmental assessments and with few governmental regulations, Berlin felt it could meet that deadline.

Professor A.E. Shuttleworth of the Ontario Agricultural College, working alongside the Berlin group from the beginning, had already signed up enough area farmers to guarantee that 5,000 acres of sugar beets would be planted in spring 1902. But where would they be processed?

Williams had first eyed the Kolb property beside the Grand River near the Breslau bridge. However, keeping in mind that there was significant involvement from the Breithaupt family in the project, it isn't surprising that the 49-acre Fries farm overlooking the Grand between Berlin and Bridgeport was selected instead … adjacent was 20 acres of Breithaupt land also for sale. The 69-acre purchase was finalized in March 1902 — just six months to go.

Samuel J. Williams was a multi-tasker and he visited Cleveland's E.H. Dyer Company, the most experienced factory contractor in the United States. Dyer had recently built a 400-ton-capacity sugar beet plant in Benton Harbor, Michigan, but the processing company had failed. Dyer's suggestion? Dismantle that factory's steel framework, then move it and the machinery to Berlin. All Williams had to do was arrange for three million bricks to be made locally!

So, the Benton factory was taken apart, put on a freighter, unloaded at a Lake Erie port, brought to Berlin by rail and re-erected — one month to go. Williams also convinced the Grand Trunk Railway to run a spur to the factory site from Berlin's mainline.

All the pieces fell together as beets began arriving at Berlin's 600-ton-capacity factory. More than one-third of a mile long, the partly-transplanted, partly-new complex contained sugar storage hall, seed sheds, beet storage sheds, processing area, cooperage and main factory.

Wagon loads and train cars full of beets pulled right into the factory from farms around Waterloo County and Southern Ontario. The beets had been hand-harvested by hundreds of labourers who did the back-breaking work of pulling them from the ground, chopping off the leaves and roots then loading into wagons. Once at the plant, the processing was more mechanized and, somehow, by November 1902 the first refined sugar beet product was ready.

The future looked rosy for this exciting new industry but the rose faded quickly.

By 1907, OSC's original directors, including the local contingent headed by Williams, had all departed. Briefly, Berliners J.C. Breithaupt and C.K. Hagedorn ran OSC but things unravelled in 1908. W.H. Breithaupt became president of the short-lived, retitled Berlin Sugar Company. He tried to keep the business operating but courts declared OSC bankrupt. In January 1909 all assets were sold, all capital stock wiped out, all local investors left high and dry, all farmers unpaid. However, debenture charges from the 1901 bonus bylaw continued showing up in Berlin/Kitchener budgets into the 1940s.

A Wallaceburg refinery, Dominion Sugar, purchased the factory and kept some local sugar production going until 1923 when all the equipment was removed and the local sugar beet industry ended.

The subsequent history of the factory building has many facets ranging from corrupt to inspiring to money-making. In the new year, Flash from the Past will bring this remarkable story up to the present. In the meantime, drive out past Lancaster Street to the end of Union, enjoy the look of the modern reincarnation, Hacienda Sierra, and realize it is only one-fifth of the original factory size.

Back on March 25, Flash from the Past drew attention to a derelict pump house along the Grand River which had supplied water to a huge sugar beet factory. This week and next, we'll examine a remarkable example of innovative Berlin business hustling, a physical part of which remains at the end of today's Union Street. That it failed within two decades was due mainly to global market forces — sound familiar?

At the end of the 19th century, each Canadian consumed 60 pounds of sugar a year. Ontario produced zero pounds of sugar. Six million dollars flowed out of the country to places such as Belgium, the U.S.A. and Germany; in return, processed sugar poured into Ontario.

Guelph's Ontario Agricultural College reported that locally-grown sugar beets yielded 11 to 17 per cent saccharine, similar to foreign beets. Each acre of local farmland could produce 15 to 20 tons of beets at a cost to the farmer of two dollars. Sold at four dollars per ton, farmers stood to rake in handsome cash. Investors, middlemen and processors could also harvest some of that $6 million. That's the sugar beet factory story's "why" … the "how" is more complicated.

In those years, Berlin's Board of Trade and its town council were virtually interchangeable: what was good for business was deemed good for Berlin. Board of Trade president Samuel J. Williams, Berlin mayor Dr. G.H. Bowlby, MPP Louis J. Breithaupt and Waterloo Township reeve and prominent farmer Tilman Shantz were the go-getters quarterbacking Berlin's sugar beet game plan.

Breithaupt used his political muscle in Toronto to get the Berlin area included in a 1901 OAC Beet Sugar Cultivation Test. A purity of 80 per cent was considered minimum: Berlin rated at 85, still behind other locales. However, in pounds-of-beets-per acre, this area topped all 12 test plots.

A factory site had to have good railway connections; plenty of limestone; three million gallons of water daily during refining season; easy drainage into a river for effluent (which would destroy the fish stock); and 200 men to work around the clock during refining season. Berlin wasn't perfect but those conditions could be met.

In September 1901, Toronto investors formed the Ontario Sugar Company and visited Berlin dangling a possible $500,000 factory. OSC said Berlin's deficiencies might be overlooked for some financial considerations — tens of thousands of dollars as a bonus, a free factory site and significant tax exemptions. Such stipulations didn't shock Berlin! For years that council/Board of Trade combination had been using those methods to attract businesses. Ironically, in 1886, that's exactly how S.J. Williams' own firm, WG & R Shirt & Collar, had been lured to Berlin from Toronto.

A bylaw was prepared to provide a $20,000 bonus, tax exemptions and $5,000 to purchase farmland near the Grand River. The go-getters went to work buttonholing voters, arranging excursions to Michigan's prosperous sugar beet factories, lining up local investors and persuading farmers to grow sugar beets. The 40-year debenture was approved by voters on Nov. 1. Convinced county farmers joined in by promising a rebate of 33 cents per ton of delivered beets.

It was looking good for Berlin until two dissenting OSC investors departed, leaving the concern $100,000 short. S.J. Williams stepped forward and, over the next few weeks, convinced Berlin and Waterloo business friends to open their wallets. Crucial meetings were held in Toronto on Dec. 25 and 26 between Williams and OSC directors. In many Waterloo County homes, a huge question mark hovered over Christmas celebrations: would OSC approve building its factory in Berlin?

Following Boxing Day meetings, S.J. Williams wired to Berlin: "The directors have decided unanimously in favour of locating in Berlin."